what is the format for consignment account?

Pdav80119

2 months ago

A Consignment Account is an account prepared to record goods sent by a consignor to a consignee for sale on their behalf. It is not a trading account, so it has its own format.
WAEC expects you to present it clearly like this:
FORMAT OF CONSIGNMENT ACCOUNT
Consignment Account (in the books of the Consignor)
Dr (Debit side)
Particulars
Amount
To Goods sent on Consignment A/C (Cost of goods sent)
xxx
To Consignment Expenses (Freight, insurance, etc.)
xxx
To Consignee’s Expenses (if reimbursed)
xxx
To Profit on Consignment (if loss side is balancing figure)
xxx
Cr (Credit side)
Particulars
Amount
By Consignee A/C (Sales proceeds)
xxx
By Closing Stock on Consignment
xxx
By Loss on Consignment (if loss occurs)
xxx
2. Consignee Account (optional but often required)
Dr
Amount
Cr
Amount
To Cash/Bank (remittance)
xxx
By Goods Sent on Consignment
xxx
To Commission
xxx
By Cash from Sales
xxx
To Expenses paid
xxx
By Balance c/d
xxx
3. Important Working (VERY IMPORTANT in WAEC)
You are usually expected to calculate:
Cost of goods sent
Sales value
Consignment expenses
Commission (ordinary & del credere)
Closing stock on consignment (at cost + proportion of expenses)
Profit or loss on consignment